:max_bytes(150000):strip_icc()/GettyImages-923217650-7c509f1319aa49bc81535f3c3576306a.jpg "The Inadequacy of a 60/40 Portfolio in Today’s World")
For many years, a large percentage of financial planners and stockbrokers crafted portfolios for their clients that were composed of 60% equities and 40% bonds or other fixed-income offerings. And these so-called balanced portfolios did rather well throughout the 80s and 90s.
But, a series of bear markets that started in 2000 coupled with historically low-interest rates have eroded the popularity of this basic approach to investing. Some experts are now saying that a well-diversified portfolio must include more asset classes than just stocks and bonds. As we’ll see below, these experts feel that a much broader approach must now be taken in order to achieve sustainable long-term growth.
Key Takeaways
Once a mainstay of savvy investors, the 60/40 balanced portfolio no longer appears to be keeping up with today’s market environment.
Instead of allocating 60% broadly to stocks and 40% to bonds, many professionals now advocate for different weights and diversifying into even…
2023-12-24 19:50:46
Article from www.investopedia.com
rnrn
